NEWTON, MA – Congressman Jake Auchincloss’s Promotion of News and Miscellaneous Filing Institutions Act has passed the House of Representatives as part of the Racial Equity, Inclusion, and Economic Justice Act of the United States. Financial Services Committee.
Auchincloss’ bill requires banking regulators to work together to address the challenges new banks face when applying for a bank charter. The bill specifically calls for a strategic plan that takes into account the challenges faced by new financial institutions, including minority depository institutions (MDIs) and community development financial institutions (CDFIs).
“Consumers should have access to affordable banking services, which requires market competition,” Auchincloss said on the House floor. “Over the past few decades, there has been consolidation among banks and credit unions. This has effectively limited the products available to consumers and artificially driven up costs while closing bank branches for people who don’t didn’t have much choice.”
“The Racial Equity, Inclusion, and Economic Justice in Financial Services Act includes my bipartisan bill, the Promoting New and Diverse Depository Institutions Act,” he continued. “My bill will help new banks, and in doing so, it will expand access to affordable services for unbanked communities.”
According to the Federal Reserve, only seven new banks were created between 2009 and 2013. This study will inform the next steps Congress can take to expand competition and access for consumers.
The Promoting New and Diverse Depository Institutions Act has been endorsed by the Credit Union National Association, Chamber of Commerce, American Bankers Association, Independent Community Bankers of America, Massachusetts Bankers Association, and Financial Technology Association.